Delta looks at subsidy to continue air service

TUPELO – As ominous as a “notice of termination” sounds, Terry Anderson prefers to see the term in a different light.
On Tuesday, the executive director of the Tupelo Regional Airport said Delta Air Lines was preparing to file a “notice of termination” to end air service in Tupelo and seven other cities.
“I don’t like using the word ‘termination’ because of its connotation that it’s the end – it’s not,” Anderson said. “Air service will continue in Tupelo; it will not end.”
Citing a drop in customer demand and a rise in fuel prices, Delta – and by extension, its regional carrier, Mesaba Airlines – has identified Tupelo and seven other markets it deemed “not economically self-sustaining.”
But the move is a strategic one. Delta merely wants to obtain federal subsidies to continue serving the markets it plans to “terminate.”
After getting the notice, the U.S. Department of Transportation will issue a “hold-stop” order that prevents an airline from stopping service.
For the next 90 days, the federal agency will request bids for airlines to serve those markets with a subsidy through its Essential Air Service program.
That means Delta/Mesaba and any other carrier interested in providing air service can bid on it.
The amount of the subsidy, which must be reviewed every two years, depends on the service provided.
And Mesaba President John Spanjers wrote in a letter dated Monday that “Delta and Mesaba tomorrow will take steps to receive a subsidy for continued service in these markets.”
Spanjers also wrote, “It is our – and Delta’s – intention to continue servicing these markets without interruption under the DOT’s EAS program, and to participate in the bidding process.”
Delta had no immediate comment.
During the 90-day period – which will begin whenever the USDOT receives the notice – negotiations will involve the airlines, airports, Congressional officials and local leaders to determine the extent of the air service to be provided.
It’s those talks that may prove beneficial to Tupelo, Anderson said.
“In the final analysis, it won’t be just the highest bid, but what is the best bid that will provide the citizens the best air service in Northeast Mississippi,” he said.
Tupelo Mayor Jack Reed Jr., who is attending the Mississippi Municipal League’s annual meeting in Biloxi, agreed.
“This can work in our favor,” he said. “What this will do is that we’ll insist in our negotiations (to provide better service) rather than being in a position to complain or harangue about what we’d like. This will put us right at the table.”
For now, Delta provides two departures from Tupelo: an early flight to Memphis and a late-morning flight to Atlanta. Arrivals are mid-morning and at 9 p.m.
But what the future schedule might be depends on how the talks go, and Anderson and Reed said they look forward to it.
“We’ll meet them anytime, anywhere to ensure we have dependable, affordable air service in and out of Tupelo,” Reed said.
Contact Dennis Seid at (662) 678-1578 or dennis.seid@djournal.com.

Dennis Seid/NEMS Daily Journal